Competing for Jobs Through Exports: China Far Outstrips All Other Countries in Providing Official Export Credit; United States Now Positioned to Advance America’s Comparative Leadership and Support More U.S. Jobs
FOR IMMEDIATE RELEASE June 30, 2020
Office of Communications (202) 565-3207
WASHINGTON – The Export-Import Bank of the United States (EXIM) today released its June 2020 Report to the U.S. Congress on Global Export Credit Competition (Competitiveness Report), which covers the 2019 calendar year. The Report aggregates input from U.S. exporters and lenders as well as EXIM’s counterparts from other countries and comprehensively analyzes official export credit and trade-related finance that was provided last year by governments around the world.
“Building on my testimony before the Senate Banking Committee just one week ago, I am pleased to submit EXIM’s latest Competitiveness Report to Congress. The findings are illuminating for both U.S. lawmakers and the diverse American workforce they represent,” said EXIM President and Chairman Kimberly A. Reed. “The Report shows just how wide and deep is the involvement of foreign governments—especially China—in promoting and financing exports from their countries. In the end, it comes down to competing for jobs through exports, and EXIM stands ready to support our great American workers.
“Thanks to the leadership of President Trump and strong bipartisan support in the U.S. Congress, the year 2019 was historic for EXIM,” Reed added. “The 2019 Competitiveness Report highlights many of these ‘wins’ – including reopening EXIM after its Board quorum was restored in May, authorizing the largest-ever EXIM transaction, and reauthorizing the agency for the longest tenure in EXIM’s history – to help level the playing field for U.S. companies and workers. This Report also underscores the magnitude of Chinese state-backed unfair competition, which undermines our exporters and even puts America at a disadvantage in key sectors critical to our long-term economic and national security. Fortunately, our nation is taking a competitive approach to these, and other, challenges posed by Beijing, as outlined in the United States Strategic Approach to the People’s Republic of China. EXIM is pleased to have the new Congressional mandate to establish a ‘Program on China and Transformational Exports’—one of the agency’s most significant efforts in its 86-year history—to counter China and its opaque and exploitative model of economic development and finance and advance the comparative leadership of the United States.”
As required by law, the EXIM 2019-2020 Advisory Committee, which is chaired by the Honorable Stevan Pearce, carefully reviewed the findings of the agency’s Competitiveness Report. The Advisory Committee’s statement to the U.S. Congress is included in the Report. The Advisory Committee noted that, “The days of the United States, through inaction, giving away hundreds of billions of dollars in business to foreign competitors must be seen as having come to a decisive and permanent end. An inspired, energetic advancement of the mission of the newly empowered Export-Import Bank of the United States will go far in making this vital objective a reality.”
While this Report focuses on calendar year 2019, it includes a preface describing the official export finance market’s response to the COVID-19 (coronavirus) global pandemic. For the first time, the Report also includes an introductory primer outlining the building blocks of export and trade-related financing available to help U.S. companies of all sizes better compete across the globe, as well as a chapter focusing on foreign export credit agencies’ (ECAs) proactive efforts to support small businesses facing global competition. Also of note, the Report covers an expanded, in-depth view of official financing practices from China’s numerous government institutions.
- Worldwide, there are presently 115 known official export credit providers, including ECAs such as EXIM—up from 85 only four years earlier—a 35 percent increase from 2015 to 2019.
- The top 10 providers of official medium- and long-term (MLT) export credits in 2019 were China ($33.5 billion), Italy ($11.1 billion), Germany ($10.5 billion), India ($7.0 billion), the United Kingdom ($6.6 billion), France ($ 6.2 billion), South Korea ($5.8 billion), the United States ($5.3 billion), Finland ($4.1 billion), and Sweden ($4.0 billion).
- In 2019, the aggregate amount of official MLT export credit provided under the rules of the Organisation for Economic Cooperation and Development’s (OECD) Arrangement on Officially Supported Export Credits, to which EXIM adheres, was approximately $76 billion—only 34 percent of the total official MLT export and trade-related finance provided by governments worldwide.
- Foreign ECAs are using their official MLT trade-related programs (programs outside the scope of the OECD Arrangement) to offer more flexible financing, including in support of their country’s small businesses.
- From 2015 to 2019, China’s official MLT export credit activity alone was at least equal to 90 percent of that provided by all G7 countries combined. (Of note, beyond its two official ECAs, China uses several other official government entities to finance its exports and trade practices through a variety of means, including export credits.)
- By a conservative estimate, China’s official export and trade-related financing totaled at least $76 billion in 2019. An exact figure is impossible to come by, given the opacity of Chinese official financing.
For additional highlights from EXIM’s Competitiveness Report, please see the fact sheet on EXIM’s website.
First mandated by Congress in 1971 and now in its 53rd edition, EXIM’s annual Competitiveness Report meets the agency’s requirement to report on how well EXIM was able to provide financing that is competitive with other major foreign government providers of export credit and enable U.S. companies to be competitive in global export sales.
EXIM is an independent federal agency that promotes and supports American jobs by providing competitive and necessary export credit to support sales of U.S. goods and services to international buyers. A robust EXIM can level the global playing field for U.S. exporters when they compete against foreign companies that receive support from their governments. EXIM also contributes to U.S. economic growth by helping to create and sustain hundreds of thousands of jobs in exporting businesses and their supply chains across the United States. In recent years, approximately 90 percent of the total number of the agency’s authorizations has directly supported small businesses. Since 1992, EXIM has generated more than $9 billion for the U.S. Treasury for repayment of U.S. debt.
For more information about EXIM, please visit www.exim.gov.